In what situations will a static budget be most effective in evaluating a manager's effectiveness?
A)The company has substantial fixed costs.
B)The company has substantial variable costs.
C)The planned activity levels match actual activity levels.
D)The company has no fixed costs.

Question

Quizplus · Accepted Answer

Static budgets are most effective when the planned activity levels closely match the actual activity levels, as they do not adjust for changes in activity levels.

In What Situations Will a Static Budget Be Most Effective